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Finance a la shmoop what is a market order? alright people it's a type of buy

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or sell order which simply says I will buy or sell this stock or bond at this

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price right now that is whatever price the market is telling me it's worth [Investor discussing market orders]

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right now that's my price so the market prices change all the time and yes of

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course the broker can choose to look at his screen this minute or that minute or [Broker looking at computer screen]

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the following minute and the market will be changing if you're placing the order

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during the day so yes there is some discretion in defining exactly what

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dollar amounts and penny amounts a market order means but in real life

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usually through online portals or even through old-school telephones yes those [Person using an old-style telephone]

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things the broker will say something like yep I see coca-cola quota here at

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42.48 that's market right now you want it and if you want to sell well then you [Woman selling bonds while on the phone]

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mumble something like go ahead and just so you know the kissing cousin of a

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market order is a limit order like an investor might tell the broker give me a

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42.50 limit on that coke sale if the stock never hits 42.50 like it's

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below at 42.49 doesn't do it well then no sale ever happens and the [Coca cola stock price graph stamped with no sale]

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owner of those coca-cola shares well they just keep them if the stock

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suddenly pops and it gets there then blam the shares have been sold well in

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practice most relatively sophisticated buyers and sellers put in limits like

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limit orders not just naked market orders even if they are below what the

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market currently floats because flash crashes happen all the time it seems

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these days and in one fleeting moment shares of coca-cola could suddenly [Coca cola share price drops]

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plummet to 34.12 a share and if the seller has a market order in while those

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shares will transact or be sold at 34.12 even though 15 minutes later the markets

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back to its 42.50 a share pricing so you can get really heard if you rely on

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the market being a stable and rational so vanilla pure market orders can be a [Man with pigs head riding a bike]

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dangerous thing be careful just ask the little piggy you know who went to market

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